GM settles ignition switch flaw cases

By Drew Harwell, Washington Post

September 17, 2015Updated: September 17, 2015 10:22pm

Photo: Carlos Osorio, STF

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FILE - In this Oct. 1, 2014 photo, General Motors CEO Mary Barra addresses the Global Business Conference for investors in Milford, Mich. General Motors on Thursday, Sept. 17, 2015 said it will pay $575 million to settle hundreds of civil lawsuits filed against the company over faulty small-car ignition switches, including the bulk of pending wrongful death and injury cases. (AP Photo/Carlos Osorio, File) less

FILE - In this Oct. 1, 2014 photo, General Motors CEO Mary Barra addresses the Global Business Conference for investors in Milford, Mich. General Motors on Thursday, Sept. 17, 2015 said it will pay $575 million ... more

Photo: Carlos Osorio, STF

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U.S. Attorney Preet Bharara speaks during a news conference at the U.S. Attorney's office in New York, Thursday, Sept. 17, 2015. The government and General Motors have reached a deal to resolve a criminal investigation into how the Detroit automaker concealed a deadly problem with small-car ignition switches. (AP Photo/Kathy Willens) less

U.S. Attorney Preet Bharara speaks during a news conference at the U.S. Attorney's office in New York, Thursday, Sept. 17, 2015. The government and General Motors have reached a deal to resolve a criminal ... more

Photo: Kathy Willens, STF

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DETRIOT, MI - JUNE 9: General Motors CEO Mary Barra holds a media briefing prior to the start of the 2015 GM Annual Meeting of Stockholders at GM world headquarters June 9, 2015 in Detroit, Michigan. At the meeting, stockholders will vote on the election of directors, and ratify the selection of Deloitte and Touche as the company's independent registered public accounting firm for 2015. (Photo by Bill Pugliano/Getty Images) less

DETRIOT, MI - JUNE 9: General Motors CEO Mary Barra holds a media briefing prior to the start of the 2015 GM Annual Meeting of Stockholders at GM world headquarters June 9, 2015 in Detroit, Michigan. At the ... more

Photo: Bill Pugliano, Stringer

GM settles ignition switch flaw cases

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For hiding an ignition-switch defect tied to at least 169 deaths, General Motors will pay a $900 million fine - less than a third of its $2.8 billion in profit last year - and its employees will face no criminal charges.

The settlement with the Justice Department, announced Thursday, signals a close to the criminal investigation that has tarnished the car giant. But critics say GM got off easy for mishandling one of the worst auto safety crises in history and for years of lying to safety regulators.

"I have a saying about GM: 'There's no problem too big that money can't solve,' " said Clarence Ditlow, director of the Center for Auto Safety. GM "is buying their way out of a criminal prosecution."

The Justice Department agreed to hold off on prosecuting GM on charges of wire fraud and scheming to hide the defect from regulators and to drop the criminal case in three years if the automaker continues to acknowledge responsibility, accept independent monitoring and cooperate with authorities.

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"People were hurt and people died in our cars," CEO Mary Barra told employees. She said the agreement was "tough" but added, "We didn't do our job, and as part of our apology to the victims, we promise to take responsibility for our actions."

Critics point out that the $900 million fine is a small fraction of the $50 billion that taxpayers gave to GM during its bailout. No executives will face jail time, even after the company acknowledged how high-level delays contributed to roadway deaths.

GM's penalty also is less than the record $1.2 billion fine levied on Toyota last year after the Japanese car giant failed to recall cars that could suddenly accelerate; regulators say that defect has been linked to at least five deaths.

Preet Bharara, the U.S. attorney in New York, credited GM for their "extraordinary cooperation" in the federal probe.

GM also announced Thursday that it will pay $575 million to settle more than 1,300 pending death and injury lawsuits.

Attorney Bob Hilliard said those class-action suits involve at least 45 deaths not included in the 124 deaths counted by Washington attorney Kenneth Feinberg, who was hired by GM to help assess claims and compensate victims. Hilliard has estimated the total death count could rise above 200 after all cases are settled or closed.